The healthcare technology and consulting firm reached a deal with activist investor Paul Singer's fund that ends the threat of a director battle—for now.

Advisory Board (ABCO) on Friday reached a settlement with activist investor Elliott Management's Paul Singer that ends the threat of a director battle—for now—as the healthcare technology and consulting firm continues to explore strategic alternatives, such as a sale.

As part of the deal, Elliott Management, which owns an 8.3% stake, agreed not to launch a director-election proxy fight for a period of time and the Advisory Board signed a nondisclosure agreement. In a securities filing, Elliott said it may potentially participate in a "strategic transaction" that Advisory Board might consider, which suggests that the activist investor is seriously thinking about trying to buy all or parts of the business.

An acquisition by Elliott of Advisory Board is a real possibility. Richard Brand, a partner at Cadwalader, recently told participants at a "future of shareholder activism" event hosted by Reuters that he expects Elliott Management to expand into acquisitions.

"We're going to see more of a convergence between the activist style of investing and private equity style of investing," Brand said. "You are going to see activist hedge funds buying more companies, that's the natural next step. Elliott ... is offering to buy companies. Carl Icahn is buying companies."

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Under pressure from Elliott, which launched its campaign in January, Advisory Board earlier this month announced it had retained Goldman Sachs and Allen & Co. to explore alternatives. Strategic options are likely to include consideration of transactions with private equity players as well as a potential break up of its healthcare and higher education business.